Mounting trade tensions could soon begin to threaten interest rates as President Donald Trump and key trading allies in Europe and other regions increase trade tariffs.

The world economy is increasingly at risk of a new recession as trade war threats progress. In a recent survey, experts forecasted the next recession will occur by the year 2020, and placed trade tensions high on the list as the most likely to cause the recession.

In fact, Capital Economics even predicted that the Federal Reserve will reverse course and cut interest rates in 2020.

Now, as trade tensions worsen, the Bank for International Settlements said there are already signs that “the ratcheting up of rhetoric” is weighing on investment, according to an article by Angela Monaghan for The Guardian.

And BIS General Manager Agustín Carstens explained the current loose monetary policy is now posing a threat to economic stability.

From the article:

Carstens said normalisation of monetary policy – raising rates and unwinding other measures such as quantitative easing – was essential “to rebuild policy space”.

In the U.S., the Fed already seems on board with this thought as it plans to raise interest rates about twice more in 2018, and two or three more times in 2019. The 30-year fixed-rate mortgage interest rate could hit 5% by the end of this year or the beginning of next.

But despite the uncertainty, a new poll from CNBC’s All-American Economic Survey shows that for the first time since he took office, Trump holds the approval of more than half the U.S. for his handling of the economy at 51%.

For the first time since 2014, lenders reported a negative profit in the first quarter this year, data from the Mortgage Bankers Association shows. This is due to increasing costs to originate a mortgage and the fall of refinances as interest rates rise.

But as lenders continue to struggle with interest rates this year, many hope that utilizing digital mortgages will help cut back on costs as competition rises. Freddie Mac talks more about that in this podcast.

And while many tech companies are stepping up to help lenders through this difficult time, escalating trade tensions and increasing uncertainty surrounding rates will work against lenders struggling in the changing rate environment.